Lakeland revenues hit €1bn after 'historic year

The Lakeland Dairies 2019 Annual Report is the first since the merger of Lakeland Dairies and LacPatrick Dairies, completed in April 2019.

Lakeland Dairies, the largest cross-border dairy processing co-operative on the island of Ireland, has posted financial results for the year with revenues crossing €1bn for the first time in the group's history.

Leading to this point, Lakeland Dairies has doubled revenues in the past five years.

The Lakeland Dairies 2019 Annual Report is the first since the merger of Lakeland Dairies and LacPatrick Dairies, completed in April 2019.

The results are for the year ended December 28, 2019.

Lakeland Dairies collects 1.85bn litres of milk from 3,200 farm families across 16 counties in Northern Ireland and the Republic of Ireland. The co-operative has a portfolio of 240 different dairy products made on eight processing sites which it exports to 80 countries worldwide.

Group Revenues hit €1.03bn

Lakeland Dairies achieved record revenues of €1.03bn in 2019 across its four operating divisions of Food Ingredients, Foodservice, Consumer Foods and Agribusiness.

Group revenues increased by €224.6m (+27.7%) on the prior year figure of €810.5m. This yielded an Operating Profit of €20.5m, up by €2.97m +16.9% and EBITDA (Earnings Before Interest, Tax, Depreciation & Amortisation) of €42.9m which increased by €9.3m.

Lakeland Dairies concluded the year with a significantly enhanced balance sheet including Shareholders’ Funds of €197.2m.

Food Ingredients revenue up 19%

Food Ingredient revenues increased by 19% to €583.8m, based on overall positive trading conditions, strong demand for our functional and enriched powders, proteins and dairy fats, and organic growth across the combined ingredients operations of both former societies.

Strong showing for Foodservice Division

The Foodservice Division delivered revenues of €239m and continued to build value across its customer base in every continent worldwide.

Solid performance for Consumer Foods

Consumer Foods delivered a solid performance in 2019 in line with expectations, yielding revenues of €139.7m for the year with all categories providing growth.

Successful year for Agribusiness

2019 was a successful year for Lakeland Dairies’ Agribusiness Division where revenues at €72.4m were in line with budget expectations.

Feed volumes of over 210,000 tonnes and fertiliser volume of over 27,000 tonnes were achieved.

CE Hanley 'happy' with results

Lakeland Dairies Group Chief Executive Michael Hanley said he is happy with the 2019 performance.

“As a business, we’re pleased to report this strong and prudent set of accounts. This is a positive outcome for 2019, based on a strong and efficient performance across all operating divisions.

“This has been done while leveraging from additional revenue streams and the overall synergies achieved by the merger of Lakeland Dairies and LacPatrick Dairies which created the newly constituted Lakeland Dairies Co-operative Society Ltd in April of last year.

“The success of the merger process to date has demonstrated the true potential for Lakeland Dairies to realise our strategic plans for continuing growth and development in the decades ahead.

Mr Hanley stated that Lakeland remains “driven” to delivering further value and long-term sustainability for the 3,200 farm families, north and south, which feed into the processor.

While providing competitive advantage for our global food ingredients customers in 80 markets worldwide also, he however warns that there are “considerable challenges” ahead.

“The ongoing market disruption caused by the COVID-19 global pandemic has put a significant drag on markets, particularly in the foodservice sector. A lack of clarity on the shape of the trading relationship between the EU and the UK post-Brexit is of concern to us too. Not to mention the ongoing global dairy supply and demand dynamic which has a huge influence on international markets,” said Mr Hanley.

“Lakeland Dairies traces its roots back over some 125 years. In that time, we have faced and overcome many challenges. Backed by our 3,200 farm families as well as our loyal customers and committed staff, we are confident of being able to tackle these challenges,” Mr Hanley concluded.

'Historic year'

Also reacting to the results, Lakeland Dairies Chair, Alo Duffy, said: “2019 was a truly historic year for the dairy industry and the milk suppliers in the northern half of the island following the merger between Lakeland Dairies and LacPatrick Dairies in April.

“The merger that we have collectively and cooperatively achieved has been a success. This has enabled us to go from strength to strength and it is now instrumental in our capacity to deal with the current challenging times facing us all.”

He adds that based on the local company's positive achievements and continuing co-operative endeavours, that their intention is to meet any such challenges, as well as many opportunities, with an “absolute and unwavering determination” to succeed.

“I thank each of our 3,200 farm families for the continued support of their Society,” said Mr Duffy.